Every home has its own recipe for streaming content, with data showing that 63% of US consumers watch premium TV shows and movies in a typical week and two-thirds of families stream video weekly (1).
To cater to this demand, big brands in the TV industry are taking new approaches to how they make content available to their customers, especially OTT apps. Spectrum recently announced that HBO Max and YouTube had joined Netflix within the Spectrum Guide, meaning customers can access the streaming services directly from the Spectrum TV platform. In addition, British broadcaster Sky, this month launched Sky Glass “simplifying the way customers watch TV by integrating hardware, software and content” bringing Sky channels with popular applications in a plug-and-play TV.
But why is progress towards serving up a seamless library of apps in the TV industry lagging behind the mobile industry? ActiveVideo’s CEO and President, Jeff Miller, looks at the top four challenges for device makers, app developers and service providers to overcome and better drive change in the industry.
1. Complexity when switching devices
We no longer live in an age when we turn on the TV when we get home and watch whatever’s on. Statistics show that devices in the home are increasing in numbers and consumers need to know more about how their devices operate and interconnect. How consumers view, search and play content is different across platforms, even down to how they exit the app. Switching devices means that consumers are switching experiences, and there’s a growing frustration around this complexity. For example, how do consumers access Amazon Prime Video on a Roku, versus Disney+ on an LG smart TV?
In the US for example, more than a third of households have four or more connected TV streaming devices in the home, not including smartphones and tablets (1). And many of those devices will be in service for five or more years in some cases. This means there is a role to play for the device makers, as well as app developers and service providers, to manage this complexity go forwards.2. Providing a seamless TV experience
Consumers are looking for a solution that’s consistent across devices, affordable, and they will accept advertising in the experience if it’s relevant and performs the actions they need. Whatever they’re watching on their phone, they expect to be able to watch immediately on the TV after putting their phone down. This expectation of the same quality across every platform, regardless of its age, demonstrates that consumers care less about the physical device and more about the experience. It is possible to align and make it easier for consumers to engage with their much-loved platforms and services, which is where we’re heading in the market. The friction comes from a lack of collaboration from the parties involved to develop this seamless experience.
3. Fragmentation continuing to accelerate
In the early days, we thought that consumers would think of streaming devices in the same way they think of a mobile phone - functional with a coolness factor. Yet, this vision never caught on with streaming devices and consumers don’t think of them as a fashion accessory. This is why consumers don't tend to be loyal when it comes to streaming devices - they'll buy different devices and keep them for as long as they can, unlike phones which consumers upgrade when the next upgrade comes out. Consumer behavior is not driving to a standard device - it's driving more fragmentation.
Everyone wants a unified user experience, consisting of one screen, one menu and one search bar to get you the content you need. Content providers are busy competing against each other to reach the largest footprint with the best content and the ideal user experience. However, having the largest footprint and the ideal user experience are competing objectives. Device fragmentation forces the content provider to either reduce the footprint to the devices that are capable of running the ideal user experience, or dumb down the user experience to run on the lowest capability device. To ensure resilience and beat competition, providers need to improve the content they offer and reduce friction for the consumer. Again, TV operators also have a role to play in creating this ‘uber experience’ that allows consumers to find and drill into the content they want by helping to create a consistently great user experience and reducing friction for consumers. If TV operators want to get involved in the next generation of television, they need to compete.
4. Balancing apps across the world
When consumers think about streaming services, they tend to think of the major OTT apps, such as Netflix and Amazon Prime. While these are important on an international level, every country has its own important apps for streaming. From a device maker’s perspective, the problem surrounding complexity is not about testing and certifying the top 15 or 20 apps. There are usually 10 to 15 apps relevant to each region, as well as 10 to 15 international brands consumers want. To balance the US with the rest of the world and for international OTT content to get onto other platforms, it’s clear there is a need for a simpler approach.
The problem is the complexity of onboarding 30 OTT apps, rather than the top three, due to the cost of certification and testing, the length of time it takes to onboard the apps and the nature of getting apps to fit onto physical devices. Service providers need an app store as OTT apps are essential to the viewing experience. This can all be achieved in the cloud. For example, providers and operators can benefit from AppCloud which lives in the public cloud and delivers content from the world's favorite OTT apps to almost any TV.
We’re seeing innovation in some markets, but there is still a way to go on a global level. The bottom line is, device makers, app developers and service providers need to approach the TV, OTT and video market with new solutions, making content navigation easier for consumers while balancing complexity and commonality in app design.
To find out how ActiveVideo is bringing app content to the TV, visit our AppCloud page.(1) Dealing with Dueling Devices, Brett Sappington, Vice President, Interpret, 20 July 21